Kevin Humphreys (Dublin South East, Labour)
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133. To ask the Minister for Public Expenditure and Reform if his attention has been drawn to the value for money assessment by the National Development Finance Agency on the proposed waste to energy incinerator project in Poolbeg conducted in 2005; his views on whether it is acceptable to use data that is eight years old when the economic circumstances of the country have changed considerably in the meantime when considering whether to continue with a project; if he will indicate if his Department has a policy in place for reassessing capital investments and public private partnerships that were proposed during different economic times in view of our changed circumstances, and what that policy is; and if he will make a statement on the matter. [32779/13]

Brendan Howlin (Wexford, Labour)
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My Department has the same role in relation to PPP projects as it does in relation to capital investment projects generally. It sets the overall capital investment framework and the basic principles to be observed for the appraisal, assessment, procurement and evaluation of projects. It does not have a direct role in delivering individual projects (either PPP or traditional Exchequer capital projects). This is primarily the responsibility of the Sponsoring Department/Agency. All spending Departments must comply with the new Public Spending Code which draws together all of the standard guidance for assessing, reviewing and appraising public expenditure programmes – current as well as capital – in the public service. The Code highlights the need to revise appraisals if there are time lapses, changes in circumstances or significant additional costs involved in projects. In particular, Cost Benefit Analyses (CBAs) for capital projects should be reviewed at key stages to make sure the project is still justified. The Code also states, in relation to CBAs, that a final reassessment of demand and costs should be undertaken if there is a significant time lag between the appraisal and commissioning of the project.

Additionally, a full suite of guidance material has been published to facilitate the PPP process. This guidance dovetails with the Public Spending Code but also includes specific technical tools to evaluate PPP proposals and tenders. The key aspects of the guidance relate to the assessment of projects for procurement as PPP, the compilation of the public sector benchmark and ensuring value for money through the PPP process. There are a number of specific tests throughout the procurement and tender negotiation processes to ensure that best value is derived for the State. Details of the timing and content of these value for money tests are set out in the various PPP guidance issued by my Department which are available at www.ppp.gov.ie.

In accordance with the guidance issued by my Department, the National Development Finance Agency (NDFA) has the role of providing an opinion to the Sponsoring Agency in relation to the value for money testing on a PPP project. I am informed that the NDFA issued a value for money letter on 21 June 2007 when the Poolbeg incinerator project was at contract close with conditions precedent outstanding. NDFA later wrote to Dublin City Council in March 2012 to clarify that the previously issued NDFA value for money opinion of June 2007 was no longer valid as this opinion was based on the original contractual arrangements which had since changed. The NDFA has been requested by Dublin City Council to provide an opinion on an updated value for money test and this will be undertaken once the Public Sector Benchmark and all of the supporting documentation is completed, finalised and submitted to the NDFA for consideration.